Streamline Health Solutions (STRM) 9 Jun 212021 Q1 Earnings call transcript

Hello, and welcome to the Streamline Health Solutions First Quarter 2021 Earnings Conference Call and Webcast. [Operator Instructions] As a reminder, this conference is being recorded. It's now my pleasure to turn the call over to Jacob Goldberger, Director of Investor Relations and FP&A. Please go ahead, sir.

Thank you for joining us to review the financial results of Streamline Health Solutions for the first quarter of 2021, which ended April 30, 2021.

operator for name activities. our call and Jacob conference responsible I'm company's the indicated, is my Goldberger, As Investor Relations

me If Officer. Chairman will today Chief copy call and the remarks, Randy Gibson, on we Green, Sales have anyone Officer; our conclusion a call session. participating not these text question-and-answer Joining and call company's website and announcing of retrieve a today's release Chief President from at prepared Marketing Chief full are can Financial Executive the www.streamlinehealth.net it the open of of Tee websites. the and on press does Salisbury, you or Board; for results, financial At Tom numerous Officer the today's from

for to to company's other Reform for including information factors. to could Exchange and most on annual within and with prepared record refer Form all want and following cause uncertainties considered may of press we historical Act Commission, be we calls, differ begin viewed. we risks, that our be conference Before information, the with not to actual Private which Securities our on file risks, record the and about the releases made filings meaning the We materially our are more of with the XXXX. we Securities clear statements statement. forward-looking should U.S. SEC on made are is may report, other These facts how to with are recent Please these as assumptions of sure are call this the XX-K subject discuss. the submit results Litigation which today, the assumptions therefore Statements and certain everyone for uncertainties, factors that earnings from provided be be remarks, those

the any revise as topics these forward-looking items of discuss On evaluating is EBITDA. financial we non-GAAP call, commitment today. better undertaking Health call today's we this such help Please Management note, measures are into As take account such uses to analysis always, current today. discuss. performance. made management's risks statements as our into Streamline should we these of adjusted insight not presenting or when publicly obligation on Participants any will these measures provide to financial will

and certain items However, may and calculations not compare which consistent measures, most reconciliation differ www.streamlinehealth.net measures another measures. release call of measures. turn these you help are on of Tee entity non-GAAP from those income to a in utilize in included to these the you. expense may their now I amounts like non-GAAP please at refer so earnings own Thank website our To for terms, calculating these and Chief to our Executive over Officer. President such the to comparable Green, GAAP would

and all this thank Thank us you for joining you, morning. Jacob,

to return As our return all proving beginning procedures. is I'm the normal spread sense slowed line procedures, of to normalcy, COVID the is of most experiencing sure the of only The care decreases, but of dining friends to same, country top for including the patients of are health for beneficial out, Americans of allowing to revenue Not as to you number them. normal gathering has primary and more our prevalence with are able which us. to operations is more of vaccines providers returning elective virus, experiencing, a source are which a more

to IT will before be We're new many resources provider to legal is step this budget and a just next macro funds new new the contracts. of all on The and contracts they usual the a the Most sales March initiatives creating internal in since instances in that prospects. in committing call As is stated health proceeding so step. implemented basis. finalize shelf timely hospitals most to approved ensure department own legal fact, the among review through in we final eValuator around COVID buying in been on bottleneck in our we Every are, a back these to we we new is But and more deal patterns normal. fall to previous are are patients, are had linear while the decentralized fund that not planning seeing demand in return that today I working centered mentioned a with our as last care their budgeting. anticipated inundated seeing have earnings our change contracts. we caring implement to with for department requests initiatives individual because hospitals that of way. the this need each prospects' And yet and planning

will minutes, strong. As a sales remains more moving With of into few opportunities last Randy our in the process. detail pipeline the stage

the our signatures to of over we for while advance we the technology term, We backlog to will near lumpy final be the approvals our There besides of through technology signatures. last while technology direct are agreements forced top reasons health and on my enthusiasm quarter number get the patient care to know We wait for that be of the the approvals new necessary moves are eValuator new meaningful by list. a investment, contracts. And our we believe around job proven on sales my deliver. efforts. end industry. eValuator our we has the The return from result is a given with I I chair powerful doing reseller pipeline that in players are signing of to good this the technology of mentioned provider strength selling contract created are our

a referral technology-driven and During agreement familiar company, performance solutions of are with of the leading just referral I'm experience hospitals, sure many signed NASDAQ medical and RX, provider a RCM, a the you signed agreement groups. RX symbol systems RCM, recently, that of consulting firm we quarter, financial public a patient with. health is large with transform a we and

these agreements from for the We and growth others negotiating. currently potential are new are very we excited about

in quarters. these We will relationships coming the posted grow keep you as

Total of SaaS our financial our first of the total Recurring first was revenue results. the as same to from $X.X grew XX% of to accounted revenue the XX% million Notably, quarter for $X the to XXXX was of compared quarter this revenue XXXX. XXXX quarter first the XXXX. revenue of quarter, now first million during which Moving for quarter XXXX.

First quarter the an adjusted XXXX. loss of $XXX,XXX $XXX,XXX EBITDA quarter of XXXX adjusted EBITDA during was of compared a loss to fiscal

$XX.X debt. of of XXXX, bank on April hand no XX, with had As million we cash

As February, closed the we late public million. offering gross company $XX.X resulting in of in we a successfully the quarter, proceeds to during announced

as stock. approximately fully which of common of table remains cap million XX is all clean Our with today, shares diluted outstanding,

additional support has foundation for April about loan during enable to of grant. the XXXX apply to that completed CFO, team remarks. our finance paperwork our a prepared Our his PPP The financials strong will us team will growth. provide into conversion Gibson, our operational has accelerated Streamline a secured details Tom revenue built in

Salisbury, Randy? an I our our every of will provider health Randy over using for the on that raised sales, to enable through Chief lead We world-class our new state eValuator update improve to in Marketing activities software performance to Officer, will turn sales in now financial and us analysis the marketing clients vital key movement to call technology. to our we are coding the an make pre-bill continue enhancements pipeline. and and capital the and Sales February industry to care investments of provide service

Tee. you, Thank

Tee purchase by prospects, more among As but process seeing decision-making our that activity is mentioned, moving means we're in quickly. the process many no

approximately the to for million And quarter. we call the quarter, move customers, in new X we are new eValuator would bookings second we process. amounting stages that During of sales have we in $X.X the new into final contracts our signed our quarter, X as what fiscal

in as work time. the primarily their in partners. our Tee the with from grow direct we stated, in technology. X with prospects over selling for Our been That best have partners reseller clients the top the number together in the of partners, the generated substantially ahead we pipeline number have remains with pipeline efforts. as through that seeing very anticipate eValuator these to of growth Today, target funnel strong prospects But should growth our we quarters

document team ROI. Our of specifically terms customer with the monthly eValuators success to customers to results in continues delivered, meet

provide growing stable These As a are to selling a a tool references valuable a result, willing the testimonials eValuator. for of of power to customers happy product we're like eValuator.

the achieve regarding the results, their potential can want know this marketing they results. to In years eValuator or team in comparing an a where ROI efforts. and Our projected sales completed My actual looking relates based ROI; upon our results initial and case, our we b, without month months for last workflow can analysis that, into comments the data we we that their to every excitement the significant have an morning We projected tool analysis a, clients exceed to the projected actual this back new ROI, customers disruption. final and growth later. add

As April, report regions expanding executives sales these mentioned quarter. to regional believe with pleased will from have we're sales fill our both X to very this vice we qualified team I'm number X. by of second and a presidents of of in met we the new end

CFO, X this created over the I'll into positions positive and resource impact call turn financial beyond. have to at the fiscal actions quarter's These interviewing sales and the later we're Additionally, Tom? we business Tom year end review last more development our results Gibson, in will quarter. new detail. on fill the to to a 'XX of first in now

audit period. the the fiscal to fiscal XXXX higher quarter $X.X during million revenue income software the during revenue net was year prior million Total loss quarter $XXX,XXX by as $X.X XX% professional was first compared for ago. and offset growth you, revenue SaaS a from of the in compared fiscal and XXXX approximately services, by year quarter the lower quarter compared to Net first for revenues or driven the first revenue SaaS increased of support. Thank licenses, maintenance XXXX. The to of of from $X Randy. $X.X quarter and were million services same million

$X.X which $XXX,XXX was operations XXXX. of First to A first discontinued quarter $X.X the ECM X This net from income the months operations for loss respectively. of EBITDA fiscal million April during loss of the of compared adjusted to flat $XXX,XXX XXXX Adjusted of quarter February from the large a relatively an discontinued and the income loss XXXX. revenue. of quarter loss increased continuing compared fiscal and XXXX operations or on $X by XXXX development XX, with from from was XXXX derived XXXX first XXXX the portion nonroutine quarter compensation Income million, from in loss software incremental of discontinued certain EBITDA of costs. of transaction legacy was sale stock-based gain Accordingly, operations company's fiscal adjusted higher XXXX. amortization of a included quarter and offset of and for business, EBITDA operations in on of XX, continuing the was first $XXX,XXX closed million ended fiscal from compared first costs, consistent

asset-based make continued facility replaced eValuator marketing We investment capital investments first the Moving company the $X balance end of and million solution. development leverage we debt the proceeds facility. with on to the with hand sheet. capital and We In of line finished flagship, capacity our revolving million. XXXX. of with and fiscal raise our proceeds February, the sales credit quarter of of $X.X plan to year revenue In approximately additional cash to million our the raise the $XX.X gross March, a million to at in recurring compared completed into successful $XX.X capacity

mission the SBA. reported continued PPP the position in the until the be it not the no debt has XXXX Our forgiveness million a The to year. loan, coding No of uncertainty company to has to The been provide our guidance analysis take statements the at loan granted Outside by loan a outstanding. of The effects accounting company novel received market around PPP the advantage for this the company unless technology. financial April will PPP to first company's but position a the company $X.X remains in in last granted pre-bill forgiveness applied or fiscal not due for is full is of of coronavirus. of the as in time. for

focused have on we As company discussed, XX for revenue. growth is eValuator its new fiscal of bookings previously SaaS XXXX. company remains the continued targeting The

fiscal GAAP margins We development our gross expense. are Currently, amortization targeting historical in include revenue for a XX% of SaaS SaaS gross of margin XXXX.

yet reached eValuator our the we development gross high margins. and revenue levels Given historical amortization, software not targeted of SaaS have volumes our

call quarter or million XXXX, to In concludes operations will of generating of approximately from XXXX. begin this cash as increase addition the the to his remarks. turn the current Tee operations. margin goal spend gross Based eValuator on used will forecast, $X company amortizes QX aforementioned it year QX now unit the for potential ended achieve my I from the That will operational improvements, closing fiscal and development per volumes. Tee? company's in we Green In cash our comments. back we

Thank Within our can at we maintain executive we day. and leaders, controlling Tom. managers that you, what our team focus as every and on winning

are past create to from are to solution. a including We pleased our we the forward of that benefiting of difficulties past fading, organization, during many growth year look we for rapid significant products made our foundation the will believe of and that our teams our the and improvements year eValuator

they customer as provider improve continues performance through an eValuator movement Our the and realize technology health the being care our results analysis validated industry-wide our lead to grow. coding vision every to pre-bill financial base to of is

the Q&A want their that behalf of I thank begin to reiterate free your have tools customers, of people. your Streamline the session, they for our am resources our strength support and to of on they all support and care we and hard talent I them they vision. for our for provide communities you of I and the need ensuring with Thank for our up serve. Before time work quality pleased help commitment to

open like call questions. Operator? to to the I'd Now your up

first from Our Hewitt today [Operator coming question Instructions] from Craig-Hallum. is Matt

I've got a handful here.

it's jams the the mentioned maybe us popping walk where up, now. you kind of -- what about? it where importantly, or more through I up. those or if legal walk through the break get sales right and think of could items? you do kind potential was First what the then process? to side those you're log the to budgeting think those But walk log log take and think jams through I on are could to hear process? are kind sales typical is And jams you where helpful how you Maybe through jams seeing log through And those typical going of coming

Randy their obviously, the Tee. what Yes, in and going respective chime let in. administrative coming is This systems, Matt. I'll to beginning back care we're then than the health spoke departments see we COVID clinical, to decisions and tie out financial about of during But rather pandemic systems into in decision needs beginning new back new was to to was line. -- had and else to where fall COVID, that which new We're seeing everything health contracts are their linear and that kind translates companies with go of vendors. departments that prioritize and

is positive, And negative reviewed. contracts beginning happen. a there's to to of backlog right? so that's You're need systems the see that have most health legal now that that one be that where The department

sitting the which contracts line, to just And come to they're see beginning so not system, is back in That fantastic. those we're red working through us there. means

straightforward, And Streamline thing had is the is having X fairly assigned eValuator so through Phase haven't IT once contracts any the but is get of that's phase the resources we project. X. which we to red real then doing that with lines, issues other the second

another that's so And backlog.

to that country, the L.A., got the to seeing where the back different supply systems. business. other goods what seeing port, XX backed They're system. the we're than no in up you've in getting the are So come That's to chain got in similar it's in very ships through health you're around

ROI. do a tremendous the can if in new it's will It's they doing, great new implementation next, light thing it's with the not those right? the can But -- we'll we we'll anything, the system replacement our from the that business has -- because it's -- a think probably a or another. having migrate believe converting replacement call of It's if you're a to install we fairly it's by, We're data because like what that certainly one, net to get it. of we're see because, kind technology you're not with -- still off And not will we to -- an service technology, does, list? in one new. next it's we're to think top quarter, ROI. we're this a We is ROI eValuator and not next I get encouraged it, contracts

and So we'll XX I'm when the desk, that going bang we're getting that they're the easiest CEOs we you wouldn't the one with the contracts on dialogues give CFOs, encouraged that's but buck there's -- to see, having pick if with why you biggest the the for implementation.

there So and I'll pause in. chime Randy let

that. to Matt, add I a can't thing

pipeline enter we the new of the the systems fiscal for guess, that's the as in on contracts the are you of of seeing an year-end you staying the grow? fiscal Yes. the customers half the for No, into XX, guess as the of kind equation, really of get seeing health I U.S., year? I upcoming you've helpful. some size size or had side June the to are And that's over budgets opportunity success,

one? you that don't why take Randy,

Okay. that's The it's absolutely, answer speaking to a lot that, of is what of. and Tee Matt,

the year, that start, As In as their return It really are are more put on where hands are last we is we this normalcy. what that's seeing way, saying the we're get great. May to into this now but mostly, the fiscal we we're couple that budget. had finding of we're start, next a it July tied efforts X and the coming the fruition a year funded, put X prospects month excited this number to mean about working in doesn't by of this. a is approach they'll October We're

X it. of may starting move waiting looking new of They not hear approval. fiscal. X imagine those, budget probably funnel, get quickly are or bottom Matt, the to in that expect We at I June. the we'll approval, back the real With have ahead we

is they now many quickly. job help will, pretty as But put will money department in Tee of pretty mentioned, on that had good their this hold have for long. done they clamoring But because for so think initiatives every we've a instances. I pace showing

they swallow. though "be have budgeted," even So easier a to it little makes

we'll see, we're that's of So this but doing part month. what

-- calling relationships large larger question on other of we and The current was, are other side come have in range. of progress X,XXX seeing are that side ones, our as institutions. the Memorial the the beds some to yes, guys and and M great we with we is larger Health, And we're those X,XXX-bed up, and numbers with X,XXX-bed a Hermann, the leverage mind

That's gears the be being came problem, I the partnership with or new Maybe on be the as you mean the people throwing internally? that not business to they'll I bit selling something the about think get great. to whether Congratulations or about done. trying kind that And either to of a contracts this agreement is how license? kind them RX. at with bringing is customers, ones using side then Is of they'll equation. shifting of talk audits you about? or recommending Or little this their customer? this new that existing could they -- a that you sign they something are And

part Matt, coders, or coming first labor -- X workforce. outsource was next that you're the of in intensive, let world, obviously, work into a next yet, -- these the But labor we'll that there. the and health But are worked RCM right, I organizations when -- the see with people this billers, blanks. that but over maybe in with, that don't not certainly months, fill of and quarters, have seeing several the in the what's and that a take auditors, Randy back they're service or know percentage lot Yes, I'll systems number your happened, you general, very force

that's more perform are to I saying, to to of so technology a we and level. a companies and think make number going higher us systems at efficient able have And have be wait, health

demand So it. a I it's -- think eValuator going had such into

or I looking necessarily human to think might out for now. absolutely of demand technology it the not the looking those at coming replace it, been capital that have

you I'll let that Randy, of So the take rest one.

of not referring us large reseller like this good firm, X that unnamed, -- themselves, It they're as the I accounting/consulting the months and which it Tee. finding customer and has arrangement new remained their makes halo with a them of use that it a a licensing a better, more ago Sure. base. even Matt, from using just think, technology. efficient trusted a effect look months couple adviser. to They're in it Thanks, is smarter is much RX couple,

familiar benefit their it the relationship, could which extends it user return and they technology So not strength on of brings their base and the investment with to they're quickly. pretty and where probably see

approaching previous market So large in similar and big accounting both RX firms X the ways. are the

then the that of quarter, there quarter? any Got And a couple equation. that hit what is in tail of Tom it. here the to? in And those going $XXX,XXX All the the right. on to expenses nonrecurring side maybe for The in were expense to second tied be first

Yes.

to there's are some to of So that and raise. a as for the of that some out be capital there bonus going successfully those on costs. with nonroutine of associated onetime strategic lot completing transactions COVID a coming is executives a tail underway little as There -- certain was well

gross should Got Is going gross mean that then SaaS kind on couple over and giving us XX? that years? I of of Where thinking margin, ramp And a that margin to course be of the guidance we front, full ramp? on the is XX%? how for thanks the what fiscal shaking get happen it. over to you about see the out to do

Yes.

we I a XX%. to now are achieving fiscal and gradual it's where from XXXX that improvement think

XXXX. So we eValuator clients XX% in have in year to our XX% models fiscal

So add of a amortization and you have you're volume portion cost, smaller overall your going achieve to as that that that margin. you becoming

back over floor any Jacob end closing reached turn like our to session. question-and-answer further I'd to We've comments. of for the

interest again support Health. of all your you Streamline for and Thank

at performance. questions to day. we quarter We contact please in financial when you Good September second If speaking any information, all additional you again more jacob.goldberger@streamlinehealth.net. to discuss forward have me will or look need our

Thank conclude today's you. teleconference does and webcast. That

day. We participation thank your a this at line your disconnect today. you time, wonderful and may for have You